Top NFT Collections Bring in Millions of Dollars Weekly, But Which Will Survive? – Marketingwithanoy

The wild world of NFTs have taken the crypto world by storm in the past 12 months and while they are not loved by everyone, they have caught the attention of most people due to the sheer volume and number of projects popping up in the space.

The most popular NFTs are also often the most valuable, with buyers spending hundreds of thousands to millions of dollars to buy an NFT — often tied to a community — that they can keep or later trade for profit (or loss). But how truly liquid is the advanced NFT marketplace?

According to NFT data aggregator CryptoSlam, the top 50 blue-chip NFT collections have sold millions of dollars in the past seven days. During that time, the top 10 NFT collections alone brought in more than $500 million in transactions from 19,468 unique buyers, the data showed.

But many NFT holders said this demand comes with inherent risk and market volatility, among other factors, that play into the future of these digital collectibles and their liquidity.

It’s also worth noting that the number of high-roller NFT buyers tends to be smaller than the participants in the larger market for NFTs, but PROOF Collective’s new — and possibly blue-chip — Moonbirds NFTs were officially minted. on April 16 and accounted for the majority of the sales tracked by CryptoSlam over the past seven days, raising $297 million from 10,813 buyers. (A coin is when a digital file is converted into an NFT or digital asset on a blockchain, usually Ethereum or Solana, and its information is stored permanently on the blockchain.)

Even with Moonbirds, on April 17, the day after launch, there were over 10,000 buyers. But that number dropped to just 296 on April 19, CryptoSlam data showed. The bottom price, the lowest amount you could spend on the digital collectible in the collection, also fell about 16% in the past 24 hours.

“The problem is, when prices go down, things go fast,” Nick O’Neill, CEO and co-founder of The Nifty, told Marketingwithanoy. “That is especially the case with NFTs. If people start to worry, prices could rise dramatically.”

Bored monkeys are anything but boring

One of the most popular NFT collections is Bored Ape Yacht Club (BAYC), a collection of 10,000 monkeys on the Ethereum blockchain. It currently has a bottom price of over 113 ether, or $351,868. To date, according to OpenSea data, 496,700 ether, or $15,466,641,960, of volume has been traded for BAYC.

“If I have my . would sell [BAYC] currently for 50 ETH, it would sell in two seconds. If I sold it even for 80 ETH, it probably would have sold out in seconds too, just because of the current market,” O’Neill said.

While BAYC’s bottom price has nearly reached its all-time high, there was a time when it fell by 37% from February 26 to March 10, 2022, OpenSea data shows, just before it launched its cryptocurrency, ApeCoin. Prices have since recovered, but it is a signal that even the largest NFT projects could face a downturn.

In March 2022, Yuga Labs, the parent company behind BAYC and others, raised $450 million in a massive seed round led by Andreessen Horowitz, valuing the company at $4 billion. The NFT firm showed no signs of slowing down even before this capital increase, acquiring CryptoPunks and Meebits from Larva Labs earlier that month to expand its position into popular NFT projects.

“In this market, I don’t think there is necessarily a liquidity problem,” O’Neill said. “However, the liquidity problem will arise when everyone wants to sell and when the market closes. The best time to sell is generally on the way up.”

Limited buyers, but big spenders

NFTs are much more liquid than the physical art market, O’Neill said. “If you try to sell a painting worth more than a few hundred dollars, you won’t get a buy action unless you go to a traditional market.”

While traditional art has a less liquid market, blue-chip NFTs are restrictive because buying one requires the full amount of cryptocurrency, which often limits the buying pool to a small group of people.

“The cheapest BAYC is north of $350,000 — if you have that in cash, you can put a down payment on a house,” Parzival Fund CEO Josh Bobrowsky told Marketingwithanoy. “That’s something people don’t realize is that not only are these expensive, there’s no leverage; if you buy a Lamborghini, you might only need $50,000 to buy a $4 million Lamborghini. But if you want a BAYC, you need full amount in ethereum today, fully liquid.

In the past 30 days, there were 40,038 buyers in the top 10 NFT collections by sales volume, CryptoSlam data showed. While that might seem like a fair amount of people, in March the NFT community overall had more than 458,424 monthly NFT traders, according to Dune Analytics data collected by user hildobby, so those 40,038 buyers make up just 8.7% of the total. ecosystem of NFT traders .

“I always see how many people are involved; it matters how many people are involved and buying,” said William Quigley, co-founder of NFT marketplace WAX ​​and former co-founder of Tether, the world’s largest stablecoin by trading volume.

“For example, if I look at a company and it sold one product for a million dollars to one person and another company sold a million pieces of clothing for a dollar to a million people, I think I would do better with the million people,” Quigley told Marketingwithanoy, “On any given day, most of these NFT marketplaces and collections have a few numbers to a few dozen people trading at super high prices — that’s what you expect.”

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